FINAL MINUTES Regular Meeting Board of Directors Monterey Peninsula Water Management District April 16, 2007

The meeting was called to order at 7 PM in the MPWMD Conference room. Board members present: David Pendergrass, Chair – Mayoral Representative Alvin Edwards, Vice Chair – Division 1 Judi Lehman – Division 2 Kristi Markey – Division 3 Michelle Knight – Division 4 Larry Foy – Division 5 David Potter – Monterey County Board of Supervisors General Manager present: David A. Berger District Counsel present: David Laredo The assembly recited the Pledge of Allegiance. The following comments were directed to the Board during Oral Communications. (1) Christine Gianascol Kemp, representing Christo Bardis, urged District staff to process a pre-application for a water distribution permit submitted by Mr. Bardis in December 2006. She expressed concern that the lengthy processing time will conflict with the County of Monterey’s permit deadlines. (2) Christo Bardis, a resident of Pebble Beach, stated that it is essential that his water distribution system application be processed in a timely manner. This is the longest time he has ever waited for an application to be processed. General Manger Berger responded that Mr. Bardis’ concerns would be addressed under item 9. (3) Roy Thomas, Carmel River Steelhead Association, urged the District to help the fish and wildlife on the Carmel River by apprising the public of the low-flow conditions on the river and encouraging water conservation. He requested that the District effectively manage the small amount of water currently in the Carmel River for the benefit of the fish. General Manager Berger responded that Mr. Fuerst would address Mr. Thomas’ concerns under item 10. On a motion by Director Knight and second by Director Foy, the Consent Calendar was approved unanimously on a vote of 7 - 0, except for Items 5, 5a and 6 that were pulled for separate consideration. Approved. Approved. Approved. Approved. On a motion by Director Lehman and second by Director Markey, the Board authorized the Board Chair to send a letter in support of AB715 and AB1420. The motion was approved unanimously on a vote of 7 – 0. On a motion by Director Lehman and second by Director Knight, the Board authorized the Board Chair to send a letter expressing support for AB 1260. The motion was approved unanimously on a vote of 7 – 0. On a motion by Director Knight and second by Director Foy, the Board received the report on a unanimous vote of 7 – 0. Approved. General Manager Berger presented the item. A summary of his presentation is on file at the District office and is posted on the District’s website. Henrietta Stern, Project Manager, presented the report. A summary is on file at the District office and is posted on the District’s website. In response to comments by Christine Gianascol Kemp and Christo Bardis during Oral Communications, General Manager Berger advised the Board that two consultants have been retained to assist with processing the backlog of water distribution system pre-applications and applications. Processing of the 12 applications received is nearly complete, so that work can begin on processing the 33 pre-applications. They are processed on a first-come, first-served priority basis. Mr. Bardis’ application is number 13 in line for processing. Mr. Berger stated that if pre-applications continue to be submitted at the present rate, he may request that additional staff be hired to meet the increased workload. It would be premature to hire new staff at this point. During the public comment period on this item, the following comments were directed to the Board. (1) David Dilworth, Executive Director of Helping Our Peninsula’s Environment (HOPE), urged the Board to adopt an ordinance that suspends receipt of applications for water distribution systems, due to the low-flow conditions on the Carmel River. (2) Christo Bardis, stated that it is not fair that he must wait six months to have his water distribution system pre-application processed, just because the District is unwilling to hire additional staff at this time to speed-up application processing. Darby Fuerst, Water Resources Manager, presented the report. A summary of his presentation is on file at the District office and is posted on the District’s website. He reported that between October 1, 2006 and April 11, 2007, California American Water (CAW) production from the Carmel River was 40 acre-feet (AF) below the SWRCB-based production limit of 5,334 AF. CAW production from the Coastal Subareas of the Seaside Groundwater Basin at the end of March 2007 was 95 AF below the 1,400 AF production limit established by the Seaside Groundwater Basin adjudication. Stages 1 through 3 of the Expanded Conservation and Mandatory Rationing Program are based on CAW metered consumption compared to the SWRCB-based production limits. If CAW consumption is close to the SWRCB-based limit, the Board could conduct a special meeting and impose Stage 3 conservation rules. Mr. Fuerst noted that by the end of April, community water use could reach levels that might prompt the Board to consider imposition of Stage 3 conservation rules. Stages 5 through 7 are based on carryover storage in aquifers and reservoirs. On May 1, 2007 staff will evaluate the amount of water that is in storage, to determine if there is sufficient water to meet community needs for 18 months. If carryover storage is not sufficient, the community will be subject to Stage 5 conservation requirements. Mr. Fuerst reported that as of April 1, 2007, 10 inches of rain have been recorded at San Clemente Dam, compared to an average of 19 inches. Rainfall is 54% of average for the year. Runoff measured at San Clemente Reservoir was 9,850 AF, which is 20% of the expected average. Therefore, this has been classified as a critically dry year. In response to dry conditions, CAW has minimized production from San Clemente Dam to the Narrows, so that production from wells in the upper Carmel Valley has been reduced to .5 AF per second (30 AF per month) that must be provided to Carmel Valley Village. The District met with resource agencies and CAW to develop a plan that will maximize releases from the reservoirs to ensure sustained flow through the early winter season. CAW will maximize production from the Seaside Coastal Area. Total usable storage in the Monterey Peninsula Water Resources System is 31,980 AF, and 1,500 AF of that is surface water. San Clemente reservoir holds 140 AF, but only 50% of that is usable and must be held in storage through May 31, 2007. The California Division of Safety of Dams has been asked to allow that 60 AF of water to be released in May. The water could be released all at once, or spread out over the month. This would equate to 1 cubic-foot-per-second of flow each day for a month. Mr. Fuerst assured the Board that District fishery staff is developing a rescue plan specifically designed for implementation under these critically dry conditions. The following comments were directed to the Board during the public comment period on this item. (1) Roy Thomas, Carmel River Steelhead Association, recommended that water from San Clemente be released in a pulse which will help fish migrate to the Carmel River Lagoon and out to the ocean. In addition, he suggested that Los Padres Reservoir be dredged. (2) David Dilworth, Executive Director of HOPE, urged the Board to take action that evening (as an emergency measure) to impose Phase 3 water conservation regulations, based on the information presented that evening. District Counsel Laredo reported that the Board met with designated representatives regarding labor negotiations. No reportable action was taken. The Board also considered the six items of existing litigation listed on the agenda. Direction was provided to staff and Counsel, but no reportable action was taken. Chair Pendergrass reported that he attended the Department of Ratepayer Advocates meeting on regional water supply solutions. He noted that the process is moving in the right direction. He will attend the May 30, 2007 meeting. Director Markey announced that she will be unable to attend the April 19, 2007 Board Strategic Planning Retreat, due to a conflict with her work. Director Foy offered a motion to approve the variance with revised conditions submitted by staff that evening, and to schedule a discussion at the May 21, 2007 Board meeting on the possibility of amending the District’s regulations to allow installation of electronically monitored in-line meters. The motion was seconded by Director Potter and adopted on a motion of 5 – 2. Directors Edwards, Foy, Knight, Pendergrass and Potter voted in favor of the motion. Directors Lehman and Markey were opposed. The following comments were directed to the Board during the public hearing on this item. (1) Doug Wiele, representing Foothill Partners, explained that the cost of installing individual meters would be one-tenth of one percent of the project budget, and is not the main reason for this variance request. The issues are aesthetics, and taking advantage of new electronically monitored in-line meter technology that will allow CAW and MPWMD staff to monitor individual tenant’s water use from their desktop computers. Mr. Wiele stated that he was in agreement with revised permit conditions and the indemnification requirement. He stated that if the Board was not in a position to grant the variance, Foothill Partners would comply with Rule 23-A-1-i. (2) Michael Albov, representing Mr. Wiele, urged the Board to consider revising District Rule 23-A-1-i to allow installation of electronically monitored in-line meters. He recommended that the Board consider the practical aspects of the request and approve the variance. (3) David Dilworth, HOPE, recommended that the Board revise Rule 23-A-1-i to allow the installation of electronically monitored in-line meters, before considering approval of the variance request. Motion #1 -- Director Knight made a motion to approve the targets and submit them to the Public Utilities Commission along with the background information provided in the staff report. The motion was seconded by Director Edwards. Motion #2 -- Director Lehman proposed a substitute motion to continue consideration of this item until after the General Manager and Directors speak to the governing body of each land use jurisdiction within the District on strategic water issues, as authorized by the Board on March 19, 2007. The motion was seconded by Director Markey and failed on a vote of 2 – 5. Directors Markey and Lehman voted in favor of the motion. Directors Edwards, Foy, Knight, Pendergrass and Potter voted against the motion. The vote was conducted on Motion #1. It was approved on a vote of 5 – 2. Directors Edwards, Foy, Knight Pendergrass and Potter voted in favor of the motion. Directors Markey and Lehman were opposed. The following comments were directed to the Board during the public hearing on this item. (1) David Dilworth, HOPE, expressed opposition to the water targets. He stated that they were crafted to avoid a public vote on a future water project. (2) Steve Leonard, CAW, stated that CAW’s proposed Coastal Water Project would not provide water to meet the suggested future water needs targets. The project would not provide water for growth. On a motion by Director Markey, and second of Director Lehman, Resolution 2007-03 was adopted on a vote of 6 – 1. Directors Edwards, Knight, Lehman, Markey, Pendergrass and Potter voted in favor of the motion. Director Foy was opposed. No public comment was directed to the Board during the public comment period on this item. There was no discussion of the Informational Items/Staff Reports. The meeting was adjourned at 9:45 PM in remembrance of the 32 persons that were killed at Virginia Polytechnic Technological Institute and State University on April 16, 2007.

CALL TO ORDER/ROLL CALL PLEDGE OF ALLEGIANCE ORAL COMMUNICATIONS CONSENT CALENDAR 1. Consider Adoption of Minutes of the March 19, 2007 Regular Board Meeting 2. Consider Adoption of Resolution 2007-02 – Amending Fees and Charges Table – Rule 60 3. Consider Authorization of Funds to Contract with Ventana Wildlife Society for Carmel River Avian Habitat Monitoring 4. Authorize Expenditure of Budgeted Funds for Purchase of a Storage Container for the Sleepy Hollow Steelhead Rearing Facility 5. Consider Authorizing Board Chair to Send a Letter Expressing Support for Legislation Sponsored by Assembly Member John Laird – AB 715, Low Flow Water Fixtures and AB 1420, Water Conservation 5.a. Consider Authorizing Board Chair to Send a Letter Expressing Support for Legislation Sponsored by Assembly Member Anna Caballero – AB 1260, Local Governments Taxes, Fees, Assessments, and Charges Notice 6. Receive and File Water Year 2006 Seaside Basin Aquifer Storage and Recovery Testing Summary Report 7. Consider Adoption of Treasurer’s Report for February 2007 PRESENTATIONS 8. Strategic Plan Update 9. Water Supply Project Alternatives Update GENERAL MANAGER’S REPORT 10. Status Report on California American Water Compliance with State Water Resources Control Board Order 95-10 and Seaside Groundwater Basin Adjudication Decision ATTORNEY’S REPORT 11. Report on 5:30 PM Closed Session of the Board Conference with Labor Negotiators (Gov. Code 54957.6) Agency Designated Representatives: Rick Dickhaut, Cynthia Schmidlin, David A. Berger and Ellen Aldrich Employee Organization: General Staff and Management Staff Bargaining Units Represented by Laborer’s International Union of North America, AFL CIO, (LIUNA/UPEC) Local 270 Conference with Legal Counsel – Existing Litigation (Gov. Code 54956.9 (a)) A. Application of California American Water Company to the Public Utilities Commission Application No. 04-09-019 – Coastal Water Project B. State Water Resources Control Board Permit No. 7130B C. State Water Resources Control Board Permit No. 20808 D. MPWMD v. Nick Marotta, Jr., Gerda Marotta, and Does 1-100 – Monterey County Superior Court Case NO. M83498 E. MPWMD v. Roy Woods, Woods 1995 Trust, and Does 1-100 – Monterey County Superior Court Case No. M83499 F. General Rate Case (“GRC”) – Plan Revisions for Class A Water Utilities before the California Public Utilities Commission (Application NO. 07-02-023) DIRECTORS’ REPORTS (INCLUDING AB 1234 REPORTS ON TRIPS, CONFERENCE ATTENDANCE AND MEETINGS) 12. Oral Reports on Activities of County, Cities, Other Agencies/Committees/ Associations PUBLIC HEARINGS 13. Consider Request for Variance from Water Meter Requirements – (District Rule 23-A) – GLC Foothill Monterey LLC, 560 & 570 Munras Avenue, Monterey (APN 001-581-018) 14. Receive Comments from Jurisdictions and Consider Final Action on Proposed Yield Targets to Satisfy Current Replacement and Future Water Needs of the Monterey Peninsula ACTION ITEMS 15. Consider Adoption of Resolution 2007-03 – Amend MPWMD Meeting Rules Establishing Annual Rotation of the Vice Chair into the Position of Chair INFORMATIONAL ITEMS/STAFF REPORTS 16. Letters Received 17. Committee Reports 18. Carmel River Fishery Report 19. Water Conservation Program Report 20. Monthly Allocation Report 21. Monthly California American Water Production Report 22. Monthly Water Supply Status Report 23. Quarterly Water Supply Project Status Report 24. Quarterly Irrigation Program and Riparian Projects Report 25. Quarterly Carmel River Erosion Protection and Restoration Projects Report 26. Quarterly Water Use Credit Transfer Status Report ADJOURNMENT

___________________________________

David A. Berger, Secretary to the Board

U:\Arlene\word\2007\BoardMeetings\Minutes\FINAL041607.doc